The stock market took a pause on Wednesday morning, giving up a small portion of the gains that took the Dow Jones Industrial Average (^DJI) and S&P 500 (^GSPC 1.30%) to record heights on Tuesday. Investors reacted to news that unemployment claims remain stubbornly high, yet the federal government still doesn't seem to be any closer to an agreement on whether there'll be another stimulus package to help struggling Americans cope. As of 11:30 a.m. EST, the Dow was down 137 points to 29,910, and the S&P 500 fell 11 points to 3,624. However, the Nasdaq Composite (^IXIC) bucked the trend and pushed slightly higher, with an 18-point rise to 12,055 that's putting it close to record levels of its own.
Even with the markets taking a pause from their big bull run, some individual stocks had noteworthy performances. That included Fisker (FSR -1.98%), one of the more recent entrants in the red-hot electric vehicle industry. More surprising on the gainers list was Nordstrom (JWN 5.33%), with the department store retailer giving shareholders some upbeat news.
Fisker puts the pedal to the metal
Shares of Fisker were up 22% Wednesday morning, bouncing back from a small pullback over the past couple of weeks. The newly public company got a vote of confidence from the Wall Street community that inspired shareholders to boost the stock price.
Citigroup analysts started their coverage of Fisker with a rating of buy, and they set a price target of $26 per share. Citi was encouraging about Fisker's business model, which uses a third-party manufacturer rather than vertically integrating production facilities within its own business operations. That makes Fisker require fewer assets, potentially leading to higher margins than other automakers.
Citi also likes that the company's debut vehicle, the Fisker Ocean, is an SUV. The Ocean won't be available until late 2022, but SUVs have been a popular niche. Moreover, the analysts point to Fisker's efforts to offer flexible lease terms, noting the similarities in auto leasing to recurring revenue models at other types of businesses.
Fisker's stock has nearly doubled since its merger with special purpose acquisition company Spartan Energy Acquisition closed. That's a healthy gain, but it's consistent with what investors are seeing across the EV space.
Nordstrom gets a big mark-up
The struggling retail sector got a nice bump on Wednesday morning, with Nordstrom shares rising 17%. The upscale department-store retailer delivered encouraging third-quarter results late Tuesday, and shareholders were pleased to see a turnaround taking shape.
Nordstrom still suffered from the impact of the COVID-19 pandemic. Revenue for the company fell 16% from year-ago levels, even though the retailer shifted its lucrative Nordstrom Anniversary Sale from the second quarter of 2019 to the third quarter of 2020. Nordstrom saw huge damage to its usually strong off-price segment, which includes Nordstrom Rack stores, as net sales there were down a whopping 32% year over year.
Yet Nordstrom was able to deliver a profit of $53 million, using extreme cost-cutting to help bolster its bottom line. Most investors were expecting Nordstrom to lose more money, as it has throughout most of 2020.
To be sure, Nordstrom still has a long way to go before it completely turns the corner. However, with optimism about a possible coronavirus vaccine helping get shoppers back into stores, investors have high hopes that the holidays could bring even more good news for Nordstrom.